Heads between knees, brace for impact

Obama hired back all the Clinton-era officials who caused the housing bust — so they can do it all over again
In the 1990s, convinced that the US mortgage market was racist, the Clinton administration launched a massive campaign of social engineering.

Through government entities Fannie Mae and Freddie Mac, officials encouraged extending mortgages to people with little or no credit. They targeted private banks with discrimination lawsuits if they didn’t lend to enough minorities or people with low incomes. Housing prices skyrocketed as people with no down payment or shaky salaries suddenly were able to buy homes.

Then the bubble burst.

Millions were unable to pay their subprime loans, and they took the banks down with them. The housing market—and the economy —- is still recovering from the folly.